The opposition is in disarray after its erstwhile leader signs a surprise agreement with President Kenyatta

It was the most ambiguous of handshakes, despite the claims that President Uhuru Kenyatta and the opposition leader Raila Odinga's meeting on 9 March – after months of acrimony – would 'build bridges to a new Kenyan nation'. More sceptical voices cautioned about its chances of survival.

But it served a clear enough purpose. It dampened down the confrontational political mood and boosted the economy. Within hours of the handshake, the shilling strengthened and Nairobi's stock exchange index edged up.

The governing Jubilee coalition choreographed it expertly. The optics – two smiling rivals now apparently reconciled – pointed to a grand new political arrangement, even if none of the practical details were spelled out. Two hours after the handshake, the United States Secretary of State, Rex Tillerson, landed in Nairobi. Any questions he may have had about political reconciliation and national stability would be met with that day's headlines: 'The big handshake'.

Although Odinga had lambasted Washington's Ambassador to Nairobi, Robert Godec, as biased against the opposition, we hear that US pressure behind the scenes played some role in the deal. Opposition officials say that the US had been considering imposing sanctions against those politicians judged to be blocking a political settlement, a formula that Washington has used elsewhere.

For Kenyatta, the Raila rapprochement is part of his hopes for a legacy, at least a record not dominated by political and ethnic strife. Odinga is the most obvious beneficiary. It has taken his political career from street demonstrations and back into some form of government role. He may now claim to be co-ruling with Kenyatta in important aspects of national life.

Under the terms of the deal discussed, we hear that Odinga will have a plush government office at Jogoo House, next to Kenyatta's set-up at Harambee House, the obligatory ministerial Mercedes 500 with security and motorcycle outriders, a budget for the Building Bridges project and a salary. It has also freed him from pressure from his top three associates in the opposition National Super Alliance (Nasa). Wycliffe Musalia Mudavadi, Stephen Kalonzo Musyokaand Moses Simiyu Wetangula had been secretly negotiating an alliance with Kenyatta in their own right.

Threat to defectThey also repeatedly threatened to defect from Nasa unless Odinga renounced all ambitions to run for the presidency in 2022 in favour of one of them (AC Vol 59 No 1, Political rift will linger & Vol 59 No 5, Down the autocrat's alley). As a top Odinga advisor told Africa Confidential, 'Now he has beaten them at their own game and caught them by surprise. They were joyriders in a Raila-driven party.'

As the agreed agenda is so wide, Odinga will traverse the country recommending policy change and ethnic reconciliation everywhere – although many say this is what the President should be doing.

The ambiguity of the arrangement could also spark fresh rivalries within the government between Odinga, Kenyatta and Vice President William Ruto, who is already preparing for a barnstorming presidential campaign in 2022. A few months back, Odinga said that his supporters could be not ignored – a direct warning to Ruto.

Not even the drafters in Odinga's and Kenyatta's offices were aware of the purpose of the agreement, the opening paragraphs and names for which were typed in last at Harambee House, the President's office, with both men present. Quietly, but with Ruto's assent, Kenyatta had been talking to Odinga about a rapprochement since the Nasa leader declared himself 'the people's president' on 30 January.

Much of the early pressure for the pact came from First Lady Margaret Wanjiru Kenyatta and Raila's wife, Ida Odinga, who met weeks before the mock inauguration. Ida Odinga was opposed to Nasa's hard-liners, who cared little that Raila risked being charged with treason. Uhuru's mother, Mama Ngina Kenyatta, and his younger brother, Muhoho Kenyatta ('MK'), joined in, reassuring the Odingas in person that Uhuru wanted reconciliation and that a role would be created for Raila in government.

This all came to a head at Odinga's mock inauguration in January. On the day, the Jubilee leadership chose hard-line tactics: riot police and the well-armed General Service Unit surrounded Uhuru Park. But we hear that coordinated pressure by the leaders' wives led to negotiations and plans for massive police intervention were called off. Yet the Jubilee hardliners prevailed with the media ban: all television stations defying government orders not to broadcast the mock inauguration were taken off the air.

The agreement reads like a cross between an election manifesto of a new party and a list of Kenya's toughest problems – matters that the Jubilee government should be dealing with anyway. It is couched in generalities: from failure to forge nationalist feeling, ethnic friction, income inequality and corruption to electoral violence, hate speech and decentralisation's link to security (AC Vol 58 No 23, Counting on the counties).

Beyond establishing a secretariat?– led by Ambassador Martin Kimani, the government's Director for Counter-Terrorism, and Orange Democratic Movement's lawyer Paul Mwangi – the agreement says little. This should suit Odinga and the experts he will bring into his office, enabling him to recommend interventions in most national ministries.

Vice-President Ruto welcomed the agreement with caution, having seen Odinga defect from the opposition in 1998 to join Daniel arap Moi's Kenya African National Union in government. Odinga proceeded to wreck the party from within, defecting back to the opposition with a large following in 2002 and eventually unseating KANU.

Ruto's Kalenjin wing of Jubilee worries that the Kikuyu faction under Kenyatta could bypass him for the leadership succession in 2022. This is despite repeated assurances from Kenyatta that he and his allies will stand by Ruto.

The biggest losers are Mudavadi, Musyoka and Wetangula. Once sure of its position close to Jubilee, ODM began to distance itself from Nasa, removing Wetangula as Senate minority leader on 15 March and replacing him with James Orengo, a Raila loyalist. The trio now say that they want to negotiate their own agreement with Kenyatta but for now they are marooned politically. Yet as often happens with Kenyan politics, that could all change next month.

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